The Indian federal government plans to renew its nationwide lockdown measures as new COVID-19 cases continue to increase. The lockdown, which has been effective since March 25, is likely to be extended by another month. Coronavirus cases in India have so far reached 3.3 million, with no sign of plateauing or peaking yet. Meanwhile, Testing rates were at 27 per 1,000 on August 24, among the lowest in the world.
India’s lockdown measures were among the world’s most stringent when it first took effect five months ago. However, it led to a near-total collapse of economic activity and fuel consumption. The country began steps to reopen the economy in late April, but new infections rose steeply as people were not properly following face mask rules and distancing measures.
State refiners said demand for their diesel fell by 19% month-on-month and 23% year-on-year in the first two weeks of August. The pandemic has also raised concerns whether Saudi Aramco and ADNOC will proceed with their commitment to invest in the 1.2 million bpd refinery project in Maharashtra, which costs more than $65 billion.
The Reserve Bank of India said the country’s economy would continue to shrink until September. Some economists have predicted a 7.5% contraction in the 2020-2021 fiscal year. India’s GDP growth decelerated to the slowest pace in 11 years of 4.2% in the previous fiscal year.
